Personal injury claims are hiking up the cost of motor insurance, the Association of British Insurers informs us.
Drivers now have to pay on average an extra £40 per year due to the high legal costs surrounding road accident claims. The Association analysed 50,000 low value RTA claims and found that, although the average personal injury compensation award was £2,430, accident solicitor’s legal fees boosted the overall bill up by another £2,100. In other words, 10% of all motor insurance premiums go to personal injury solicitors.
The ABI is now calling for implementation of Lord Justice Jackson’s recommendations and a faster, more cost-effective way of awarding compensation to accident victims.
The Association of Personal Injury Lawyers has been quick to point out that plans are already underway to change the compensation system. A spokesman for the APIL said he was amazed that the ABI is still focussing on this argument at a time when its members are actively involved in creating a new process to deal with accident claims.
The new scheme will make RTA claims more efficient and will apply to straightforward cases up to £10,000. Government figures show that around 75% of all personal injury cases fall into this bracket.
Recent research by the AA showed that drivers in the UK have seen their insurance premiums increase by 11.5% over the last 3 months, and young motorists aged 17 to 22 have been hardest hit because they are more susceptible to accidents.
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